Unfreezing of funds helps further thaw standoff

Transfer clears way for talks to focus on N. Korea disarmament

March 19, 2007|By Joseph Kahn, New York Times News Service

BEIJING — The United States and North Korea have resolved a standoff over North Korean funds frozen in a bank account in Macao, clearing the way for talks to focus on putting in place a nuclear disarmament accord, Chinese and American officials said Sunday.

Deputy Assistant Treasury Secretary Daniel Glaser said the funds would be transferred to a Bank of China account in Beijing to be used for education and humanitarian purposes in North Korea, The Associated Press reported.

Christopher Hill, an assistant secretary of state who is the chief American envoy at the talks, said he met with representatives from the North Korean delegation over the weekend to explain the American position on $25 million in North Korea-related accounts in Macao's Banco Delta Asia.

An 18-month investigation into the bank ended last week, putting responsibility for returning the funds to North Korea in the hands of the authorities in Macao. But funds connected to illegal activities, such as money laundering, counterfeiting as well as narcotics and weapons trafficking, are not supposed to be returned.

North Korean officials have said several times in recent days that they will not move forward with their commitment to shut down the nation's nuclear plant at Yongbyon by the middle of April unless they recover the $25 million. Senior officials in North Korea have not yet indicated that they consider the Macao matter to be resolved.

But the issue "will not be an impediment to our six-party talks," Hill told reporters. The North Korean officials "made it very clear that they have begun their tasks for the purpose of denuclearization."

State Councilor Tang Jiaxuan of China told a group of visiting Japanese lawmakers Sunday that the United States and North Korea had resolved the dispute, said Hidenao Nakagawa, secretary-general of Japan's ruling Liberal Democratic Party.

The United States, North Korea, China, Japan, South Korea and Russia reached an initial agreement Feb. 13 that gave North Korea 60 days to shut its facility for producing plutonium for nuclear weapons at Yongbyon in return for aid and security pledges.

Representatives of the six nations will convene here Monday to hammer out details of that agreement and establish working groups to discuss other diplomatic and security concerns.

Also, Hill said he hoped to set up a working group to examine whether North Korea had been seeking to make nuclear fuel from highly enriched uranium, as well as its better known effort to use plutonium.